Policy Briefing on the Market Stability Reserve

This policy briefing responds to the Commission’s proposal for a Market Stability Reserve, a structural reform to the EU Emissions Trading Scheme (ETS). We explore why introducing a Market Stability Reserve could help to improve the cost-efficiency and resilience of the EU ETS; we explore how the Commission proposal could be improved to deliver these aims more effectively; and finally, we explain why a one-off environmental adjustment to the cap is also necessary if the ETS is to deliver Europe’s stated climate goals in a fair and cost-effective manner.

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